U.S. Frozen Chicken Wings It in Poland

By Jim Higgiston and Piotr Rucinski

Perhaps the term "chicken-mania" overstates the popularity of poultry meat in Poland. But if so, not by much. The Poles appear to be preening for status as our No. 1 poultry meat market in Central Europe.

U.S. poultry producers exporting to this market also have a lot to crow about. By 1997, they had scratched up a 61-percent share of Poland’s 60,000 tons of imported poultry products, up from 55 percent the year before. Comprised mainly of frozen chicken parts, Poland’s overall poultry imports rose 39 percent in 1997.

Poland’s domestic poultry industry is also basking in the glowing market. According to USDA estimates, Polish producers enjoyed a 13-percent increase in production in 1997, up to 430,000 tons. They exported 25,000 tons of poultry meat, mostly duck and geese.

Lifestyles, Re-Exports Egg on Trend

The healthful aspects of poultry meat haven’t been lost on a population long devoted to the finer points of processing pork and beef; in 1997, each Pole consumed 11.5 kilograms of poultry meat a year. By 2010, this amount could rise to 18 kilograms. Compare this to the United States where per capita consumption was 46.6 kilograms in 1997.

While overall meat consumption is increasing in Poland, poultry meat production is on its own fast track, infringing on the domains of pork and, especially, beef. Besides health considerations, certain market factors have fed the poultry increases:

• Popular U.S. fast-food restaurants like McDonald’s and Kentucky Fried Chicken have whetted appetites for tasty chicken convenience products;
• Limited supplies of red meats in 1977 left consumers looking for alternatives;
• Poultry’s lower prices (excluding turkey) have proven irresistible for Polish shoppers.

Besides the trend towards more poultry consumption, a major transhipment phenomenon is underway in Poland; Russia and Ukraine have become the final destination of many frozen chicken parts originally shipped to Poland.

Some major importers estimate only 15 percent of Poland’s imported poultry meat is consumed in-country. As much as a third to a half of U.S. poultry is transhipped, escaping the strict import quotas of 8.5 percent (31,314 tons in 1999) of Poland’s production the year before.

Gobblers Gaining Ground

U.S. exporters should keep an eye on Polish poultry consumption, which is expected to increase 11 percent in 1998 and 4 percent in 1999.

Chicken now occupies the top of the production pecking orde, making up 70 percent of the poultry flocks after a 10- percent increase last year. But turkeys are nudging up the ladder. In 1997, turkey meat consumption rose from14 percent to 16 percent of Poland’s poultry meat market share. Forecasters expect continued fast growth of turkey meat processing, which will in turn stimulate an increase in turkey meat output.

Most turkey meat is processed and sold in poultry sausage, which competes with pork sausage. So far, the Poles haven’t developed a taste for fresh or frozen turkey. It’s not traditional and, perhaps more importantly, costs about three times as much as chicken.

Competitive fresh and frozen U.S. turkeys, promoted properly, promise a great appeal for consumers who appreciate nutritious foods with good value.

Domestic Production "Mean and Lean"

Strong demand and stiff competition from imports have forced Poland’s own poultry industry to reduce margins and increase efficiency. It took the privatization of large poultry processing plants, along with the introduction of high-quality genetics, to make the industry competitive.

Over 70 percent of Poland’s poultry--made up of chicken, turkey, goose and duck--comes from these large poultry farms. Commercial hatcheries nourish hatchlings on commercial feed until ready for market, except for the geese and ducks destined for the European Union market, which are fed on green forage.

The remaining 30 percent of poultry stock is found on small farms--range-fed, household flocks.

Most of the larger poultry slaughterhouses also have processing facilities to make sausage and smoked products. Six large companies dominate half the production, most with their own distribution and retailing systems. A wholesaling network that would also accommodate smaller processors is still on the drawing board.

About 35 percent of all poultry meat consumed in Poland is processed. In 1997, canned poultry meat and sausage amounted to 140,000 tons (12 percent higher than in 1996). Processed production is expected to increase another 12 percent in 1998.

TRQs Limit Imports

Poland’s poultry meat imports are restricted by a tariff-rate quota (TRQ) and stiff tariffs. The tariff rate for poultry meat inside the quota of 34,460 tons in 1998 is 30 percent ad valorem. Over the quota, it’s 60 percent.

A few facts for product entry:

• Importers must get a permit from the Polish Veterinary Service.
• Products must carry a health certificate, which is in Polish and English.
• Labels in Polish must be on each product box and should include date of production in numbers, the name of the producer and the product’s name.

Market Matters

Exporters should remember that promotional activities and competitive pricing that will help establish long-term relationships are important to maintaining U.S. market share.

For the entrepreneur or exporter with money to invest, the Polish poultry industry is rife with capital-hungry processors who are likely to be receptive to the words "cooperative joint venture."

And U.S. feed grain exporters should keep an eye on the poultry industry in Poland as well.

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Higgiston is the agricultural counselor and Rucinski is an agricultural specialist with the Office of Agricultural Affairs at the American Embassy, Warsaw, Poland. Tel.: (48-22) 621-3926; Fax: (48-22) 628-1172.

Last modified: Thursday, October 14, 2004 PM